At a panel discussion for independent distribs in Europe at the San Sebastian Film Festival, Laurence Gornall, CEO of the Works in the U.K., explained how Magnolia had wanted to sell pics for distribution in Blighty but retain the VOD rights.

“One of the things that they said to me is: ‘Well, we are going to look for local distributors who we can hire to do maybe a one- or two-print release and then we will put the film out ourselves and we will control the rights,’ ” Gornall said.

“The reality of it is that it is very hard to hire a distributor if you are not going to reward them at a level that is going to: first, cover their overhead; second, cover their opportunity loss — of not being able to do their own films during that period; and, third, sufficiently compensate them for changing their business model,” he said.

Magnolia already has shaken up the distribution model in the U.S., where it releases many pics on iTunes and cable VOD before their theatrical release. Recent pickups have included Sundance pic “Touchy Feely” (pictured), for which it holds worldwide rights.

Gornall said it is unlikely that such changes to the traditional release windows would work in Europe due to the differences in its geography compared with the U.S. The population is more concentrated and most people are within an hour’s drive of an arthouse theater in the major territories. Another difference is the opposition of the exhibitors. Magnolia has an advantage in the U.S. in that it has an arthouse theater chain in the same group, Landmark. Some moves are afoot in Europe though to experiment with alternative release strategies, with companies like Spain’s Filmin and U.K.’s Curzon Artificial Eye blazing the trail.